Digital Banking for Customer Delight

The banking ecosystem in India is going through a major transformation with the government taking steps to get the unbanked and underbanked population under the banking networks. This is augmented by various banks proposing new schemes to benefit its existing set of cutomers, along with attracting new ones. IDBI Bank is one such stakeholder that is reinventing itself to stand out as a customer-centric entity, says S K V Srinivasan, Executive Director, IDBI Bank, in an interview with Arpit Gupta of Elets News Network (ENN)

With the advent of smarter mobile devices, the Omni-channel banking is bringing digital channels into bank branches, customer homes, and places of business. How IDBI is transforming the world of payments and commerce?
The impetus of IDBI Bank has always been to offer innovative digital banking products and services. The bank has recently launched its mobile-based payment wallet “PayApt”. We have also launched a unique mobile-based card control App “Abhay”, which gives instant access to block/unblock the customers cards. This is a very unique offering in the industry. Our social media remittance facility is also on anvil. Our M-passbook and IMPS through Internet banking facility will be offered very shortly. All loan-related transactions including credit and debit advices and EMI reminders would be offered on a mobile platform.

How much penetration has IDBI made into the digital payment space? How do you encourage your customers to adopt mobile payments? IDBI Bank is poised to migrate majority of its customer transactions to digital channels. Currently, approximately 70 per cent of bank’s transactions are done through digital channels including ATMs.
We have done a survey on typical activities centred around retail customers at the branch and have planned to offer all these services across multichannels in a secured environment – Internet, mobile, ATM and POS. Remittance which includes payments, deposits and withdrawals, investments and trading settlement – both cash and securities – are the areas engaging our attention today. We would ensure easy interface with mobile apps. We are working on loan application and tracking through mobile device. We are populating more bulk note acceptors at the branches and also more self-service kiosks christened as e-lounges at hightransaction volume branches to drive business through alternate channels.
Customer incentivisation is increasingly being used as a lever to drive mobile payments adoption and to have deeper relationships with customers. Bank also leverages on cross-industry strategic alliances to provide additional customer value in the form of more merchant discounts and offers to boost the usage of mobile payments.

The advent of mobile payment wallets, payment banks, net banking, mobile banking have ensured that a robust payments infrastructure is in place for enabling payment through digital channels. Thus, India can and will move gradually towards being a less cashintensive economy over a period of next five years

Do you think the country can cut down its dependence on cash given the way cash continues to be the prime medium of transaction today?
India is a cash-intensive economy with it being a preferred and dominant mode of carrying out transactions. Partly, this is due to the fact that a large segment of population remained unbanked/ underbanked till very recently. Even today over 95 per cent of retail transactions happens in cash and we have large presence of offline retailers. Hence, it will take time to actually feel the impact of mobile payment solutions even as digital payment is at cusp of another revolution called united payment interface (UPI), which will make transfer of money as simple as text messaging. The Jan Dhan Yojana, Aadhar, Mobile numbers (JAM) initiative of the government which will push all government payments to people through bank accounts and cash delivery through POS at customer place will largely initiate the move to get unbanked customers both in rural and urban areas into the ambit of electronic banking.
Incentives, such as tax breaks for consumers and merchants using credit/ debit cards, lower transaction fees for electronic payments, making highvalue transactions mandatory through electronic means and imposing a levy on cash payments above a certain value etc., will also aid in shifting from cashbased economy to a cashless economy. The advent of mobile payment wallets, payment banks, net banking, mobile banking etc. have ensured that a robust payments infrastructure is in place for enabling payment through digital channels. Thus, India can and will move gradually towards being a less cashintensive economy over a period of next five years.

India is blessed with talented workforce and IFSC would benefit from this talent pool. To make India’s growth story a reality, it would require a lot of global capital inflow into the country in the coming years

IDBI Bank has become the first state-run lender to open an international banking unit (IBU) at the International Financial Services Centre (IFSC) in Gujarat International Finance Tec-City (GIFT). How will this IFSC unit enhance the bank’s global financing business?
Through the GIFT IFSC Banking Unit (IBU), IDBI Bank aims to foster greater trade and crossborder transactions between India and rest of the world. IFSC Banking Unit (IBU) set-up within the IFSC at GIFT City is our country’s first International financial hub, being set up on par with Dubai, Hong Kong and Singapore.
IDBI Bank has become the first state-run lender to open an international banking unit (IBU) at the International Financial Services Centre (IFSC) in Gujarat International Finance Tec-City (GIFT). How will this IFSC unit enhance the bank’s global financing business? Through the GIFT IFSC Banking Unit (IBU), IDBI Bank aims to foster greater trade and crossborder transactions between India and rest of the world. IFSC Banking Unit (IBU) set-up within the IFSC at GIFT City is our country’s first International financial hub, being set up on par with Dubai, Hong Kong and Singapore.
This international financial centre would facilitate raising of foreign currency resources from global markets via equity, debt or composite structures across various maturity and currencies. Prior to the GIFT IFSC, overseas Indian ventures would tap Dubai or Singapore markets for its financial requirements. The GIFT IFSC would become a global hub enabling ease in flow of capital governed by the global regulatory standards.
India is blessed with talented workforce and IFSC would benefit from this talent pool. To make India’s growth story a reality, it would require a lot of global capital inflow into the country in the coming years. This first IFSC of the country is therefore well positioned to get the talent into the centre and generate billions of foreign exchange business for the country. The GIFT IFSC is closer to Indian clients than Dubai, London or Singapore and therefore GIFT IFSC will be a preferred destination for raising resources by Indian promoted overseas entities located across the globe, which may be joint ventures or wholly owned subsidiaries or part of the value chain of its existing customers. The GIFT IBU will actively offer products such as foreign currency (FC) loans to overseas corporate customers, external commercial borrowings to corporate customers in India, trade finance and treasury business to its global customers and help the bank in achieving its overseas business targets and expand its global footprint. We are a significant player in the corporate business with syndication and appraisal capabilities. We will certainly benefit from the opportunities arising in the GIFT IBU.

IDBI Bank is undergoing major technology upgradation and business process re-engineering. How will it improve the efficiency and performance of the bank? With the revolution in Information & Communication Technology (ICT), banks have been increasingly leveraging IT solutions to enhance their performance, productivity and efficiency. The shift towards digitisation of processes entails business process re-engineering (BPR) in order to derive optimum benefits of technology upgradation. Accordingly, we have adopted a system of BPR wherein we are evolving our business processes, delivery models and information-processing systems to take full benefit of technology upgradation.
We are revamping the processes to yield benefits to all our stakeholders by increasing the use of IT solutions and prioritising and resolving internal policy issues. We are planning to upgrade our Core Banking Software (CBS), Internet banking portal, mobile banking services, among others. Furthermore, we are planning to have a robust integrated Enterprise Data Warehouse (EDW)/ data analytics for gaining insights into customer requirements and cater to the requirements in a customised manner. Our aim would be to reduce the intermediation cost substantially through the use of technology.

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The eGov magazine enjoys the distinction of being Asia’s first magazine on e-Governance. Founded in 2005, the monthly magazine is published in both print and online formats, and is focussed exclusively on the use of Information and Communication Technology (ICT) for bringing efficiency, accountability and transparency to various citizen and business related initiatives of the government.